Tribunal still to decide on Massmart hearing over retail lease agreements

Makro store in Midrand, Johannesburg.

Picture: Sowetan/Antonio Muchave

In June 2015, Massmart lodged a complaint referral with the tribunal against Shoprite, Pick n Pay, Spar, and the South African Property Owners Association, in which it alleged they were engaging in a prohibited practice in contravention of sections of the Competition Act.

In August 2015, Shoprite, Spar and Pick n Pay each filed a pleading known as an exception to the Massmart complaint.

In December, Spar filed an application to stay proceedings pending the outcome of the grocery retail sector market inquiry.

The retailers have been arguing their cases since Tuesday as to whether the tribunal should hear Massmart’s complaint.

The legal teams of Pick n Pay, Spar, and Shoprite have asked that Massmart pick up the costs if the tribunal decides in their favour.

Part of the relief Massmart seeks from the tribunal is for it to rule that all existing exclusivity clauses the respondents have signed be declared null and void — a move Spar’s representative, Anna Annandale, said could have far-reaching consequences, especially with the market inquiry under way.

But Frank Snyckers, on behalf of Massmart, said the outcomes of the inquiry would merely be recommendations and nonbinding.

"The inquiry is broader and general and is not aimed at making a finding or validating a fact," he said. Snyckers said for as long as the referral proceedings did not continue, Massmart would be suffering a significant prejudice.

"The inquiry will release its findings and recommendations provisionally next year May. But that is not up to Massmart or the commission.

"But no matter what happens in the inquiry, we will continue to be excluded from competing nationally, as findings will be nonbinding," he said.

Massmart — which owns retailers such as Game and Dion Wired — first filed a complaint with the competition authorities in September 2014, which the commission refused to probe.

The inquiry into the grocery retail market will focus mostly on the effect of national chains on small independent grocers.

Lease agreements will be one of the many issues discussed.